Ladies and gentlemen, thank you for standing by, and welcome to the Gannett First Quarter Earnings Conference Call. At this time all participants are in a listen-only mode. After the speakers’ presentation there will be a question-and-answer session. Operator Instructions: I would now like to hand the conference over to your speaker today, Ashley Higgins. Please go ahead.

Thank you, Marcella. Good morning, everyone, and thank you for joining our call today to discuss Gannett's first quarter 2020 results. Presenting on today's call will be Mike Reed, Chairman and CEO; Doug Horne, Chief Financial Officer; and Paul Bascobert, CEO of the Operating Company. During this call, we will discuss Gannett's financial results for the quarter. If you navigate to the Gannett website, you will find that we have posted an earnings supplement in addition to our earlier press release. We will be referencing it today on the call as it provides you with additional detail on this quarter's performance. Before we begin, please let me remind you that this call is being recorded. In addition, statements made during this call with respect to future results and events are forward-looking statements that are based upon current expectations. Actual events and results could differ materially from those discussed today. We encourage you to read the forward-looking statements disclaimer in the presentation, as well as the risk factors described in Gannett's filings made with the SEC. In addition, we will be discussing some non-GAAP and pro forma financial information during the call today. You can find reconciliations of our non-GAAP measures to the most comparable GAAP measures in the earnings supplement. The pro forma information presents Legacy New Media and Legacy Gannett on a consolidated basis. Lastly, I would like to remind you that nothing on this call constitutes an offer to sell or a solicitation of an offer to purchase any interest in Gannett. The webcast and audio cast is copyrighted material of Gannett and may not be duplicated, reproduced or rebroadcast without our consent. With that, I would like to turn the call over to Mike Reed, Gannett's Chairman and CEO.

Thanks, Ashley. Good morning, everyone. Thanks for joining our call this morning from wherever you happen to be situated. Prior to getting into my remarks about the company, I wanted to take a moment to recognize the unique and incredibly challenging time we are in today. It is truly unprecedented. The personal tragedies and economic devastation experienced across the country and in the communities our company serves were unimaginable just a few months ago. The toll on people, families and on businesses is overwhelming at times, and my heart and prayers are with those most directly impacted by this pandemic and the sudden change in economic conditions. With the COVID-19 pandemic, we've also witnessed the absolutely heroic work by so many across our country, fighting back for our collective health and safety, from healthcare workers and first responders to those on the front lines providing us with essential products and services. Our news organization here at Gannett highlights this work through impactful journalism every day. We chronicle the stories of these heroes who put themselves at risk every day to serve and to save. Finally, I want to acknowledge the work of my nearly 20,000 colleagues here at Gannett. As an essential business ourselves, our team has risen to the challenge of this pandemic, honoring their professional commitments while balancing the immense personal responsibilities of keeping families and loved ones safe in a time of great stress. This has enabled our company to provide uninterrupted, accurate and up-to-date news and resources to our customers and our communities, helping everyone manage through this pandemic. I want to express my gratitude to all of my Gannett colleagues for their hard work and continued commitment to our mission, as we navigate through this crisis. Before diving in this morning, I would also like to take a minute to welcome our new CFO, Doug Horne, who joined the team about a month ago. Doug brings deep accounting and finance skills, as well as significant experience with large-scale integration projects. Doug has done a fantastic job diving into the team and making immediate contributions. We are really glad to have him on board. And you'll hear from Doug this morning. And now to today's business, Paul and Doug are with me on the call, as Ashley mentioned. We'll cover our first quarter earnings, which were solid and in line with our internal expectations, despite the headwinds we felt during the last couple weeks of March. We'll cover our response to COVID-19, which came upon the country and us so quickly. It required immediate actions to keep our employees safe, to keep our business running, and to improve our Q2 financial outlook, all of which I think we accomplished. Our team moved very quickly to respond to this unprecedented event. The actions we have taken have been significant and I believe have positioned us to weather Q2, which will be a difficult quarter for most businesses and for our country. We'll also review important balance sheet items and liquidity, along with some key details of our credit facility. And we have an update on operations and importantly our progress on the integration and realization of synergies. So, lots to cover this morning. I'll start with a review of our first quarter financial performance, which as I mentioned was solid and largely in line with our expectations. After the first couple weeks of March, in fact, we were actually pacing ahead of our internal expectations for both revenue and EBITDA. However, we saw significant declines in advertising over the last two weeks of March, a direct impact of the COVID-19 pandemic. We estimate the decline we experienced in revenue from this was about $17 million during those last two weeks. Despite the impact of the decline, our same store revenue trend was consistent with that of Q4 of 2019. Without the COVID impact, same store revenue would have improved to being down 8.4%, an improvement of about 150 basis points versus our Q4 same store trend. Adjusted EBITDA was down 3% versus the prior year on a pro forma basis, and was pacing ahead of prior year heading into the last two weeks of March. Our integration and synergy realization remained on plan for the first quarter. We implemented $75 million of annualized synergies, which resulted in $19 million of cost reductions recorded in the first quarter. We also paid down $12.7 million in debt during the quarter, primarily with proceeds from real estate sales. Later on the call, we will provide an update on expected debt repayment in the second quarter with proceeds from real estate sales that are under contract and expected to close during the second quarter. We closed the first quarter with $200 million of cash on the balance sheet, which grew from $156 million at year-end. We are pleased with the progress of our integration efforts and remain confident in our ability to outperform our synergy plan, and to aggressively pay down debt through real estate sales, despite the economic crisis we are in the midst of. While the first quarter was in line with our expectations, the COVID crisis has changed things dramatically since mid-March, as I am sure many of you feel as well. Our company has had to adapt and respond quickly as the disruption to our lives, how we do our jobs, and to the economy, all of these things are just unprecedented. As I mentioned a few minutes ago, our leadership team took immediate and deliberate action to support the health and safety of our employees, and to preserve our ability to deliver high-quality journalism to our customers and to the communities we serve. I am proud of the speed and decisiveness our team has shown in responding to this pandemic. In addition to the changes taken to operate safely, we have also taken actions to enhance and improve our liquidity position and financial performance. I'll highlight four of those actions for you this morning. First, we implemented measures that we expect to temporarily reduce expenses in the second quarter by an additional $100 million to $125 million, through implementation of furloughs, pay reductions, reductions in force, cancellation of non-essential travel and spending and an expected reduction in cost of goods sold. These additional cost saving measures are additive to synergy cost reductions we will realize in Q2 as well, and also additive to the roll forward of previous cost reduction actions. As a result of all these measures, we expect Q2 expenses to be down versus the prior year by approximately 25%. For context, that compares to a 10.5% decline in cost in Q1. Second, we took immediate action to significantly reduce our CapEx spend. We have lowered our planned spend by more than 20% for the remainder of the year. That equates to about $10 million in cash savings. Third, the Board has suspended our quarterly dividend until conditions improve. And finally, fourth, we are also leveraging the CARES Act to defer FICA payments and ERISA pension payments. The CARES Act allows companies to defer these payments until 2021 and 2022 interest free. This improves our 2020 liquidity by a little more than $50 million over the remainder of this year. Obviously, none of this is reflected in our Q1 cash balance of $200 million. We believe all of these actions will improve liquidity and our financial performance, helping us to navigate through the uncertainty we are facing from the pandemic. We also remain confident in our ability to continue to execute on our integration plan. We mentioned on our last earnings call four priorities we have for 2020 and 2021. Those priorities have not changed. We are simply executing on those priorities against the backdrop of the pandemic. Let me recap those priorities for you with a little update on how we're doing. First, we expect to implement at least $150 million or roughly half of our $300 million annualized synergy target during 2020. Through Q2, we expect to have executed on $140 million of annualized synergies. We expect that these measures will enable us to realize $35 million to $40 million of run-rate expense reduction in the second quarter alone. We remain confident that we will achieve our target with regard to synergies, both in terms of amount and timing. Second, we have continued our normal course cost reductions. That's reflected in our Q1 total cost savings of 10.5%. Of the total, approximately 2% is attributable to synergies and about 8.5% is attributable to regular course cost reductions. The 8.5% of regular cost reductions is made up of permanent cost actions, as well as lower cost of goods sold resulting from lower revenues. Third, we are aggressively paying down debt with a goal to refinance the term loan when leverage is about 2 times EBITDA, which we expect to achieve at the end of 2021. Since entering into the term loan in November of last year, we have paid down approximately $50 million of debt, and we expect to make additional voluntary prepayments in the second quarter with the proceeds from approximately $50 million of real estate sales that are under contract and expected to close in the second quarter. Further, we have another $50 million to $75 million of real estate that we intend to sell throughout the remainder of this year and into next year. Lastly, we remain focused on improving our same store revenue trends. As I mentioned, we’ve seen a very strong start to the year. Performance in January and February was good, above our expectations. And as I mentioned, when you exclude the $17 million of revenue we lost in late March due to the COVID situation, our revenue trend would have improved by 150 basis points from down 9.9% in Q4 to down 8.4% in Q1. We talked a lot this morning about cost reductions, and while cost reductions are a major priority, we are balancing that against our efforts to produce quality content, quality products, product development and making improvements to our sales structure, so that we are positioned to report improving revenue trends once we get to the other side of this crisis. Now let's talk for a minute about our debt and our credit facility. We have also detailed the points I'm going to make now in our Q1 earnings supplement, which Ashley mentioned can be found on the Investor Relations section of our website. First let me say, we remain very confident in our ability to satisfy all our obligations under our term loan. Importantly, there is only one financial covenant that is tested on a quarterly basis. And that covenant is a requirement to maintain $20 million of cash on the balance sheet at the end of every quarter. As of the end of Q1, we had $200 million of cash, and we're generating positive cash flow. We feel very confident in our ongoing ability to satisfy this covenant. Importantly, our term loan does not have any event of default tied to compliance with any financial ratio. Our term loan does use debt to EBITDA ratios to determine whether we are permitted to make restricted payments, such as dividends or stock buybacks. But this should not be confused with a true financial covenant requiring maintenance of a debt to EBITDA ratio to avoid an event of default. Under our loan, the consequence of failing to comply with the debt to EBITDA ratio is solely a heightened restriction on our ability to make restricted payments, as opposed to a trigger for an event of default. Next, the term loan restricts our ability to spend more than $60 million on capital expenditures annually. We are highly confident in our ability to remain in compliance with this covenant. In 2020, we do not anticipate spending more than $45 million in CapEx. And the last point I want to highlight is that we are required to commence making quarterly interest payments in June of this year. The June payment encompasses 7.5 months of interest, so it will be approximately $125 million. With $200 million of cash on the balance sheet at the end of March and the business continuing to generate positive cash flow, we are highly confident that we can make our required interest payments. Given the current debt balance, the Q3 and Q4 interest payments would be approximately $50 million each. However, assuming additional debt paydowns with proceeds from real estate sales in Q2 of approximately $50 million, the actual interest payments in Q3 and Q4 could be about $2.5 million lower. And I'll reiterate, we are highly confident in our ongoing ability to make interest payments. We are highly confident in our ongoing ability to stay in compliance with our credit facility. Obviously, no one knows how the current crisis will play out. Hopefully the worst is behind us, but we just don't know. Some reports are suggesting that we should brace for new outbreaks of the virus and renewed lockdown in the fall and/or the winter. Let's all hope that that's not true. But it's so very hard today to know what next year will look like. However, we have a great relationship and a very open dialogue with our lenders, which gives us comfort that we can deal with the unknown, the uncertainty and the unforeseen, should the need arise. I'd now like to turn things over to Paul, who will give us all an update on operations, the important integration we have under way and the very important COVID-19 response efforts our company has undertaken. Thank you. And Paul, I'll turn it over to you.

Great. Thanks Mike. I wanted to open with congratulations to the staff at the Louisville Courier-Journal, who were awarded on Monday with the Pulitzer Prize in breaking news for their coverage of the hundreds of last-minute pardons by Kentucky's governor, Matt Bevin, during his final days in office. It's an incredible story, and we couldn't be more proud of this work and that of all of our journalists. It's really a reminder for all of us why we are here, to create an enduring platform for this important work to continue in our communities. As Mike mentioned, I'd like to speak in a little bit more detail about how we are responding to the COVID-19 pandemic, some Q1 operational details and an update on integration. Regarding our COVID-19 response, by March 20 we had migrated 95% of our non-production and delivery workers to a work from home position, which is over 12,000 employees. We also implemented social distancing measures and hygiene best practices for all of our production and delivery facilities, in line with CDC and WHO guidelines. This has included spreading out our teams and our shifts, distributing personal protective equipment, and implementing multiple daily cleanings. In addition, we've also procured and distributed masks and other protective supplies to any employee who needs to travel outside of the home for work. Across the company, we've set up communication channels for people to report infections and any workplace concerns, which we monitor and respond to in real time. On April 1, as Mike mentioned, we also implemented cost measures to save an additional $100 million to $125 million. Most of these measures are temporary in nature, such as furloughs and salary reductions, and were designed to give us some flexibility as to how to adapt based on how the future plays out. And while every functional area is participating in these cost management programs, we did work to minimize the impact on some select groups, such as lower salaried staff and people who are directly involved in the systems integration and transformation projects. So, we are now beginning to plan for the future return to our offices. We are working to develop office-specific plans to ensure sufficient supplies are at all locations, to monitor recommendations from government officials and healthcare leaders. This is really the final step to returning to the office, but it's not one that we are looking to rush in any particular way, especially given the company is in a highly functional position right now. We will ensure that we're prepared so when the time comes, we'll be prepared to transition smoothly and safely. Now turning to our performance, as Mike mentioned, January and February were also very strong revenue months that meaningfully outperformed our Q4 trends. But as the pandemic significantly affected the U.S. in March, we also saw a spike in advertising cancellations and a slowdown in new sales across both print and digital. Results are still preliminary for April; however, our initial view is that same store revenue was down approximately 30%. In response, we've adjusted our new sales focus around business segments that are better positioned during the crisis. We're also working with our existing clients, particularly our small businesses, to make sure their digital presence is strong. We're able to shift messaging for them, emphasizing features that build online presence, e-commerce capabilities and also to implement digital marketing programs to help them be discovered online. Given the range of advertisers we touch, from the very smallest local business to the largest advertisers in the world, we expect to have a front row seat on the recovery. We're ready to adjust resources, messaging and products as opportunities present themselves. I want to take just a brief moment to say how proud I am of all the work that our journalists have done through this crisis. Like so much of our team, they're working remotely and managing through furloughs, and yet they continue reporting from the front lines of this pandemic. They're telling the stories of human impact. They're holding our public officials accountable. And they've investigated the problems with testing, the lack of medical and personal protective equipment, and the crisis in our nation's nursing homes. Our journalists have met readers' needs by swarming the story, creating new coronavirus beats and teams, and reassigning reporting resources away from other areas, such as sports, to make sure that we're providing this critical information. USA TODAY moved quickly to condense certain print sections to make way for a new daily section called Nation's Health, which is being shared with subscribers across all our local sites as well. Digital traffic proves that America depends on our news. Our brands reached more than 170 million viewers in March and achieved 29% growth in digital subscriptions in the quarter, despite keeping much of our coronavirus coverage outside of the paywall as a public service. I know our communities will continue to be strongly served by our news teams as states begin to open back up, and we'll be there to make sure our readers can navigate the changes and remain safe. In consumer marketing, we've seen print subscriptions hold pretty steady while we've had a rapid increase in new digital subscriptions, as I just mentioned. In all our markets, we're seeing a recognition of the value of our local news organizations, and what they bring to their communities and the need for consumer support to continue in the face of advertising decline. We believe this crisis actually has the potential to accelerate the paid digital subscription model across all our markets. Our Events business faced an initial wave of canceled events for late March and beyond, but the team quickly pivoted, converting many races and award shows to new virtual experiences, and rescheduled many of the events later in the year when we anticipate they may be allowed. The team has done a phenomenal job of maintaining our sponsors as they completed the pivot to virtual formats. We're finding actually that participants in these virtual events are offering a welcomed reprieve to stay-at-home orders. Attendance has been fantastic. And while not the same as an in-person experience, events continue to provide an important sense of community. Using a virtual format, we’ve reduced the revenue in some cases that would have been generated through attendance and ticket sales. However, we're also significantly reducing our operating costs by foregoing the venue and in-person production costs. Finally, I'd like to highlight the significant work completed on our integration during the first quarter. Our focus here is not just on cutting costs, but on rebuilding the business to take advantage of our scale, and we're well on our way. Sales has now rolled out their new regional leadership team and rebranded the organization under the Local iQ brand. Our editorial team has completed its new regionalized structure, leveraging our expanded footprint and strong newsroom staff. We have implemented or announced 23 printing facilities for consolidation, and have begun migrating to common technology platforms for all of our key functions. Collectively, these decisions will lead to a streamlined and simplified operating foundation for Gannett for the years ahead. Importantly, we do not expect disruption from our COVID-related cost reductions on our continued synergy implementation. In the second quarter, we will implement additional measures that we expect to lead to $140 million in savings on an annualized basis, which puts us nearly at our full year 2020 synergy target, as we sit here today. In closing, I want to thank all of my colleagues across the organization. We are asking so much of everyone: delivering results, integrating companies, cutting costs, accepting furloughs and wage reductions, working remotely or navigating closed communities to get to production facilities. I just want everyone on this call to know what an incredible and committed team we have here. With that, I'll now turn it over to Doug to discuss our detailed financial performance.

Thank you, Paul, and good morning, everyone. I'm very excited to be with you this morning and even more excited to be part of the Gannett team moving forward. For Q1, total operating revenues were $948.7 million, which was up 144.8% as compared with the prior year quarter, as a result of the acquisition of Legacy Gannett in Q4 of 2019. On a pro forma basis, operating revenues were down 9.7% as compared with the prior year quarter, which is in line with what we experienced during Q4 of 2019. On a same-store basis, revenues were down 10%, largely in line with the fourth quarter trend as well. Total operating revenues, as Mike mentioned, reflect approximately $17 million of negative impact from the COVID-19 situation, primarily as a result of the cancellation or pausing of advertising campaigns during March. Adjusted EBITDA totaled $99.1 million in the quarter. This reflects the impact of lower revenues, partially offset by cost reductions and synergy savings. The adjusted EBITDA margin in the quarter was 10.4%. In the first quarter, expenses fell approximately 10.5% on a pro forma basis, reflecting compensation savings from various cost reduction and synergy initiatives, significant newsprint savings from both lower volumes and prices, as well as continued production and distribution efficiencies. Moving on to the segments, within the Publishing segment, revenue in the first quarter was $858.2 million and print advertising revenue was down 21.2% to the prior year, on a same-store pro forma basis. That is reflecting both continued secular pressures, as well as the disruption from the COVID-19 situation in the last weeks of the quarter. Digital advertising and marketing services revenues increased 1.7% on a same-store pro forma basis, driven by national campaigns during the quarter, as well as gains in digital marketing services within our local markets, offset again by the disruption from COVID-19 during the second half of March. Circulation revenues decreased 7.5% to the prior year on a same-store pro forma basis, which reflects reductions in single-copy distribution and home delivery sales and includes the negative impact of COVID-19 during the latter half of March. The year-over-year decline in Q1 reflects an improvement of 160 basis points as compared to the fourth quarter, due to seasonality in our snowbird markets. Paid digital-only subscribers grew 29% year-over-year on a pro forma basis to approximately 863,000 subscriptions. Digital-only subscriber revenue grew 36.6% on a pro forma basis as compared with the prior year. As a result, adjusted EBITDA for the Publishing segment totaled $110.9 million, representing a margin of 12.9% in the first quarter. Turning now to the Marketing Solutions segment, total revenue in the first quarter was $121.3 million, an increase year-over-year of 3.8% on a same-store pro forma basis. The increase in pro forma revenue was driven by sales of marketing services in our local markets, which was also offset by the negative impact of COVID-19 during March. Adjusted EBITDA for the Marketing Solutions segment totaled $7.9 million, representing a margin of 6.5% in the first quarter. Our Q1 GAAP net loss attributable to Gannett was $80.2 million, which reflects $78 million of depreciation and amortization, $34.2 million of cash charges related to integration, reorganization and transaction-related costs, $18.5 million related to non-operating pension income and $9 million for the quarterly income tax provision, the vast majority of which is non-cash. Additionally, the company incurred $57.9 million of interest expense during the quarter. We ended the quarter with $1.747 billion of debt after paying down $12.7 million during the quarter. Our cash balance, as Mike mentioned, was $199.7 million at the end of Q1, resulting in net debt of $1.543 billion. Capital expenditures totaled $13.8 million during Q1, reflecting investments related to digital product development, technology and ongoing facility consolidations. And with that, I will hand it back to Ashley.

Thanks, Doug. Marcella, we can open it now to questions.

Your first question comes from the line of Kyle Evans. Your line is open.

Thank you. Thanks for taking my questions. So, a lot of discussion about real estate sales as a source of liquidity. Could you provide a little bit more detail there on what you're going to bring to the market? And maybe some supporting thoughts on why you're confident you can get those done in this current environment?

Well, yes. So the real estate sales I mentioned for Q2, Kyle, are actually under contract with scheduled closing dates, down payments made, et cetera. So we feel highly confident that those transactions are nearly completed and will be completed. These are pieces of property generally that are in good strategic locations in towns across the country. And so the buyers for these types of facilities generally have very long-term plans for what they want to use the building or the land for. The kind of disruption the COVID pandemic created doesn't alter or change the long-term view of local developers and local contractors. Maybe the business next door has wanted that land for a long time. So the transactions we have under contract to sell real estate are with strategic local buyers who have a very long-term view on the market and what they want to do with the property. So we feel highly confident that the disruption that the pandemic has caused will have little impact on our real estate sales. Obviously, there's a lot of real estate that we're trying to sell over the next two years, so there could be some hiccups and some delays. But primarily the bulk of what we're trying to do is tied to, say, eight or ten properties that we feel really good about.

Got it. And you weren't going to get by me without talking about circulation. Obviously, the declines you had in 1Q were a pretty considerable improvement over 4Q, but still running down more than the first three quarters of 2019. What do you think the pandemic does to the circulation line going forward? Is it considered a discretionary spend that people will eliminate? And what were the underlying volume numbers there in the down 7%?

So, we had about $375 million of revenue in the first quarter in circulation, about $60 million of that is digital subscriptions, about $315 million is print. We mentioned digital subscriptions were up 29% in the first quarter, and we've seen that growth accelerate to more than 30% in April. I expect as a result of the pandemic and, more importantly, our ongoing efforts to grow our digital subscriber base, that growth will accelerate and digital subscription revenue will become a larger part of total revenue, and that will help drive a positive change in trend. For the first quarter, our print trends were down around 8% to 8.5%, offset by digital growth of roughly 8.5%. We're not doing much on pricing right now—just a small amount—so volumes are down a bit higher, a little north of 10% declines in volume. But I've been impressed with the resiliency of our products, both print and digital, during the crisis. This has shown our communities and our customers how important and vital local media organizations are. As Paul mentioned, we haven't really seen any further negative changes to our print circulation trends other than in single-copy sales. So that's been favorable. Right now it's hard to predict long-term what this pandemic will do, but so far we've seen some improvement overall in our circulation trends, primarily driven by digital, while print has been relatively resilient.

And what are your thoughts on pricing going forward in this current environment?

We're not raising prices in the current environment.

And would you consider eliminating some of the unprofitable print days across the system going forward?

That's not part of our plan today. We've been pretty consistent with that view. Everything is on the table depending on what happens with revenues and how things evolve, so nothing is off the table. But as we sit here today, our view is that we want our consumers to habitually come to us every day for their local news and information. We don't want to drive our consumers to other places by eliminating products in the market that we produce today. So that's our current view, subject to change as conditions evolve.

Got it. That's all I got. Also, a quick thanks on giving the liquidity and balance sheet metrics—very helpful.

Thanks, Kyle.

Your next question comes from the line of Ryan Vaughan. Your line is open.

Hi, thank you for taking my questions.

Hi, Ryan.

Just a couple of questions. You referenced the current trends that you saw through April. First off, have you noticed anything on your trends over the last five weeks—have things been steady at that rate? Second, when you reference the current trends, does that include print, digital advertising and marketing services? I'm trying to get an idea whether digital is holding up better than print.

Thanks, Ryan. The preliminary view is that April will close out down about 30% overall. That encompasses the whole company, so it includes print, digital advertising, marketing services and events. The biggest hit has come to print advertising, which is down more than 30%. Our digital business has held up better; it's more resilient than print advertising. Circulation has been the most resilient part of our business. Our events business has been hit as well—Paul mentioned events are likely down 40% to 50% in revenue for the quarter—but the team has pivoted to virtual formats and maintained sponsor relationships. Regarding the trend over the last five weeks, the last couple weeks of March were where things worsened. The first couple weeks of April were probably the worst. The back half of April showed little improvement in terms of fully offsetting those losses, but in the last two weeks—late April and early May—we've seen more meetings, more conversations, and more businesses entertaining getting back to positive spend. The tone of our conversations with customers, and the number of meetings around restarting campaigns, is encouraging. It's not something we can fully reflect in numbers yet, but it gives us cautious optimism that the worst may be behind us. For now, our best view remains April down about 30%, but the tone has improved.

That would be great. One more point about the real estate sales: you had mentioned you could take the $50 million and pay down the term loan and knock down interest by a couple million over the next quarters. To be clear, you don't have to pay down the term loan—you could just add that to cash if you wanted. There's no obligation to pay it down, correct?

No, actually we are required in the credit agreement, if we sell assets, to pay down debt.

Got it. Okay. Thank you.

All right, man. Thanks, Ryan.

There are no further questions at this time. I'll turn the call over to Mike for final remarks.

Okay. Thanks, everyone. I'd just like to reiterate our solid performance in the first quarter; we are pleased with it despite how it ended. I want to reiterate the very strong liquidity position we have today with $200 million of cash on the balance sheet, and our expectation to continue to generate positive cash flows. I also mentioned the CARES Act and the liquidity enhancement there; that's going to be more than $50 million that you have to add to the cash position we have today. Our integration plan, as you heard from Paul and Doug, is progressing really well. We have $140 million of annualized savings that we expect to have in place by the end of the second quarter. And we've taken the steps necessary to create additional flexibility and to be able to create additional cost savings during the crisis. We're in a position to continue to adapt as conditions evolve, so we generally feel really good. We continued to reduce our debt during the quarter. We remain optimistic about our ability to continue to do that with real estate asset sales. As I mentioned in my remarks on the call, we are highly confident in our ability to be in compliance and stay in compliance with our credit agreement. Just a reminder, it's a five-year term loan. We're only six months into it. So we have four and a half years left. We have nothing hanging or dangling out there that we have to deal with. It's a very unfortunate situation that we're in today, and it impacts everybody across our country and really most people around the world. But I feel good about the efforts we've made to position our company to come out the other side of this crisis, hopefully sooner rather than later, with a better, stronger and leaner company. Thanks for your time this morning. We look forward to updating you again at the end of the second quarter. In the meantime, everybody be safe and be healthy. Thanks. Bye.

This concludes today’s conference call. You may now disconnect.